Number of Children’s Schemes to be Cut to Four from 11

THE HAGUE, 04/09/13 - The cabinet wants to cut the number of schemes for parents with children sharply. Of the 11, just four will remain. On balance, this will save 800 million euros.

Social Affairs Minister Lodewijk Asscher said Tuesday in a letter to parliament that the schemes to continue are children’s allowances, the child-linked budget (an income-dependent allowance for the costs of children), the combination discount (a fiscal break for combining work and caring for children) and the childcare allowance. The other seven schemes will be merged with these four or abolished.

Before the summer, the cabinet was in talks with the leftwing Green (GroenLinks) and centre-left D66 opposition parties on pruning the children’s schemes. These talks however foundered.

Now Asscher himself has come up with plans, GroenLinks has indicated it is against them. “A mother on basic benefit will be no less than 4.5 percent worse off,” said MP Linda Voortman.

At the moment, children’s schemes cost the government around 10 billion euros a year. The cabinet plans mean savings of 800 million euros, Asscher confirmed.

The Labour (PvdA) minister wants a simplification of the children’s allowance scheme. From July 2014 to 2016, the amount will come down in stages for children aged from 6 to 17. Eventually there will be just a single amount. As against the reduction in children’s allowances, the child-linked budget will go up.

The child-linked budget will be given a wealth ceiling, above which people are no longer eligible for the money. This will lie at 80,000 euros above the wealth exemption (for a single parent, 21,139 euros). Adding the two together, the ceiling will thus be 101,139 euros.

Additionally, the income ceiling under which people are eligible for a childcare allowance will come down, from 30,939 a year at the moment for single parents and 42,438 euros for couples. For every euro earned above this level, the child-linked allowance will be cut by 7.6 cents.